Recently a young man in his early 20s told your National Conservative Examiner he isn’t counting on social security. “I know it’s not gonna be there for me,” he said.
As it now stands, according to both the Government Accountability Office and the Social Security Administration, it won’t be there for him, at least not in its current form. Once the influx of baby boomers comes aboard the Social Security payables roster, the program will be sorely challenged.
During his first national debate, Perry set off a firestorm by calling social security a Ponzi scheme. Numerous pundits weighed in with progressives having a field day attacking the governor. Some Republicans attacked him as well, fearful of the political fallout.
Most of the attackers did not quote the governor correctly—they truncated his statements in order to create headlines. Perry said, “Fact is we have to be focused on how we are going to change this program…it is a monstrous lie to tell our kids that it’s going to be there.” Almost no critic reported the preface to his remarks—how we are going to change this program.
Since the debate new information has emerged. Fact is some darlings of the left and right also likened social security to a Ponzi:
- Nobel prize winner Paul Samuelson (“a Ponzi scheme that works”)
- Paul Krugman (“the Ponzi game”)
- Milton Friedman (“the biggest Ponzi scheme on Earth”)
Alex Taborrok at Marginal Revolution has the facts on those Ponzi-scheme adherents, bringing to mind that what you do on the Web in fact stays on the Web.
Perry could have retracted his statement or he could’ve done a flip flop as politicians often do. Instead, he isn’t backing down. He penned an editorial for a national newspaper, and one point he makes sounds a warning bell:
“By 2037, retirees will only get roughly 76 cents back for every dollar that is put into Social Security unless reforms are implemented. Imagine how long a traditional retirement or investment plan could survive if it projected investors would lose 24% of their money?”
An oft-repeated point by your National Conservative Examiner relates to President Barack Obama making a bad problem even worse by reducing the payroll taxes for worker and employer on social security. Yes, this puts a small amount of extra cash into individuals’ hands, but it will also make a projected shortage even worse for those 20-somethings like the young man who said he doesn’t believe social security will be there for him.
The Social Security Administration had this to say about the program:
“[M]oney flowing into the trust funds is invested in U. S. Government securities. Because the government spends this borrowed cash, some people see the trust fund assets as an accumulation of securities that the government will be unable to make good on in the future. Without legislation to restore long-range solvency of the trust funds, redemption of long-term securities prior to maturity would be necessary.”
SSA has already halted the mailing of benefits statements to workers. Most workers don’t think to retain their payroll stubs, relying instead on government figures for what has been paid in.
The halting of those statements is a warning flag—the government is not comfortable guaranteeing benefits that may not be possible considering the record debt the Democrat Congress and president added to the deficit.
Perry stands out in aggressively taking on a vital issue others have been afraid to touch. He told the unvarnished truth about a popular social program. That 20-something young man is smart to plan ahead because the program his grandparents enjoyed will definitely not look like the program he will confront as he enters those golden years, able to retire at 70 if he’s lucky.
In his editorial, Perry wrote, “The first step to fixing a problem is honestly admitting there is a problem.”
Perry will debate 7 other Republican candidates in Tampa on Monday. A new poll of Republicans released by CNN found Perry the most electable candidate in a race with Obama.